NEW YORK, N.Y. – Icahn Enterprises is selling Federal-Mogul to Tenneco for US $5.4 billion dollars, while Tenneco has announced plans to split Federal-Mogul in two.
The price includes US $800 million in cash and 29.5 million shares in Tenneco common stock, and the assumption of all Federal-Mogul debt.
Federal-Mogul is to be divided into a aftermarket and ride performance company, and a powertrain technology business that makes parts like pistons and spark plugs. Both will be publicly traded, with the split to occur in the last half of 2019.
The sale itself is expected to close in the second half of this year, subject to regulatory approvals, and is not subject to any financing conditions.
“Icahn Enterprises acquired majority control of Federal-Mogul in 2008 when we saw an out-of-favor market opportunity for a great company. During that time, we have built one of the leading global suppliers of automotive products,” Icahn chairman Carl Icahn said in a statement.
“I am very proud of the business we have built at Federal-Mogul and agree with Tenneco regarding the tremendous value in the business combination and separation into two companies.”